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Nestlé, Coke part ways on joint venture

9 Mar 2017

While the companies say that the Beverage Partners Worldwide (BPW) joint venture has performed well for more than 15 years, Nestlé and The Coca-Cola Company have agreed to dissolve the 50-50 ready-to-drink tea joint venture.

While the companies say that the Beverage Partners Worldwide (BPW) joint venture has performed well for more than 15 years, Nestlé and The Coca-Cola Company have agreed to dissolve the 50-50 ready-to-drink tea joint venture as of 1 January 2018.

Created in 2001, BPW offers ready-to drink tea, in particular NESTEA, in Canada and Europe. The ready-to-drink tea market has evolved, and Nestlé believes the time is right to develop NESTA independently.

As part of this agreement, Nestlé is granting the Coca-Cola Company a license to manufacture and distribute NESTEA in Canada, Spain, Portugal, Andorra, Romania, Hungary and Bulgaria. In other countries that are currently part of the JV, The Coca-Cola Company will no longer produce or distribute NESTEA.

Through its Nestlé Waters division, Nestlé already manages the NESTEA brand in several countries, including the United States. Following this new agreement, Nestlé Waters will also manage NESTEA in all the European countries that are not concerned by the licensing agreements.

The consumer trend of the ready-to-drink category is evolving towards healthy hydration, Nestlé notes. Delivering on consumers’ changing needs in a rapidly expanding $4.5 billion ready-to-drink tea category, NESTEA already unveiled its new brand proposition for the US on 30 January.